NSE Indices Limited launched a new index – Nifty AQLV 30 Plus 5yr G-Sec 70:30 index – designed to measure the performance of a hybrid portfolio having 70% exposure to the Nifty Alpha Quality Low Volatility 30 and 30% exposure to the Nifty 5 Yr Benchmark G-Sec Index (Nifty 5yr G-Sec).
The index is derived from the total return versions of two separate indices – Nifty Alpha Quality Low Volatility 30 index and the Nifty 5 Yr Benchmark G-Sec index.
The weights of the equity and fixed income sub-indices can drift between monthly reset dates due to underlying asset price movement; the weights will be rebalanced on a monthly basis on 1st working day of the month.
The Nifty Alpha Quality Low Volatility 30 is an index designed to reflect the performance of a portfolio of stocks selected based on the combination of Alpha, Quality and Low-Volatility factors. As per the factsheet, the index intends to counter the cyclicality of the single-factor index strategy and provides investors with a choice to take exposure to multiple factors through a single index product. The Index consists of 30 stocks selected from NIFTY 100 and NIFTY Midcap 50. It was launched on July 10, 2017.
Top sectors in the index include Fast Moving Consumer Goods, Information Technology, Consumer Durables, Healthcare, Automobile, Auto Components, Capital Goods, Chemicals, Textiles and Construction Materials.
Further, the Nifty 5 yr Benchmark G-Sec Index is a single bond index tracking the most liquid 5-year benchmark security issued by the Government of India.
The new hybrid index constructed based on the above equity and fixed income indices is expected to act as a benchmark for asset managers and be a reference index tracked by funds in the form of Exchange Traded Funds (ETFs), index funds and structured products.
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